In a recent transaction, Horizon Kinetics Asset Management LLC has increased its stake in Texas Pacific Land Corp (NYSE:TPL), a company known for its involvement in oil royalty trading. On June 6, 2024, the asset management firm purchased shares with a total value of $1,773 at a price of $591.06 each.
This purchase is part of the firm's investment strategy and reflects its continued interest in Texas Pacific Land Corp. Horizon Kinetics Asset Management now holds a total of 1,085,043 shares in the company, as indicated by the latest SEC filings. A footnote in the document clarifies that as of February 28, 2024, Horizon Kinetics Asset Management reported beneficial ownership of 1,271,975 shares. Additionally, Murray Stahl, a key figure at the firm, has a direct interest in 2,474 shares and an indirect interest in approximately 53,550 shares. However, it's noted that Stahl does not exercise investment discretion with respect to the securities of the issuer.
The transaction underscores Horizon Kinetics Asset Management's position as a significant investor in Texas Pacific Land Corp. Investors often monitor such filings to gauge the sentiment of major stakeholders in a company, as their investment moves are seen as a reflection of their confidence in the firm's future performance.
The reported transaction was signed off by attorney-in-fact Jay Kesslen on behalf of Horizon Kinetics Asset Management LLC, demonstrating the firm's ongoing commitment to its investment in Texas Pacific Land Corp.
In other recent news, Texas Pacific Land Corporation (TPL) has posted impressive results for Q1 2024, driven by strong growth in water sales and produced water royalties. The company's consolidated revenues reached $174 million, with an adjusted EBITDA of $152 million and free cash flow of $115 million. A significant development has been the $20 million capital investment in a cost-effective desalination method that has now moved from prototype to a larger facility capable of processing 10,000 barrels per day.
TPL also created Transmissive Water Services to manage its desalination and water reuse efforts, currently negotiating with upstream operators. Despite challenges in reducing treatment costs and regulatory hurdles, the company's water business has seen significant quarter-over-quarter revenue growth, primarily driven by the demand for water-intensive simul-fracs.
Looking ahead, TPL anticipates that low natural gas prices may impact gas realizations in the upcoming second quarter. However, the company maintains a strong balance sheet, supporting ongoing investment and value creation initiatives. These recent developments highlight TPL's commitment to innovation and value generation for its shareholders.
InvestingPro Insights
In light of Horizon Kinetics Asset Management's increased stake in Texas Pacific Land Corp (NYSE:TPL), investors may find the following InvestingPro Insights particularly relevant. Texas Pacific Land Corp's financials and market performance are key indicators of its current position and potential future trajectory.
InvestingPro Tips indicate that Texas Pacific Land Corp holds more cash than debt on its balance sheet, which is a positive sign of financial health and may have influenced Horizon Kinetics' decision to bolster their investment. Additionally, the company's gross profit margins are impressive, standing at a remarkable 94.18% for the last twelve months as of Q1 2024. This high margin reflects the company's ability to efficiently manage its cost of goods sold and could be a factor in attracting investment.
From a valuation perspective, Texas Pacific Land Corp is trading at a high earnings multiple, with a P/E ratio of 31.41 as of the last twelve months ending Q1 2024. While this suggests a premium on the company's earnings, it also indicates investor confidence in its future growth potential. Moreover, the company has experienced a strong return over the last three months, with a price total return of 18.65%, showcasing a robust short-term performance that may reassure stakeholders about their investment choices.
InvestingPro Data further highlights that Texas Pacific Land Corp has a market cap of 13.63B USD and a Price / Book ratio of 12.14 as of the last twelve months ending Q1 2024, which may be considered high, reflecting the value investors place on the company's assets relative to its share price. Additionally, the company has maintained dividend payments for 11 consecutive years, with a recent dividend yield of 0.79% and a growth of 8.0% in dividends over the last twelve months as of Q1 2024. This consistency in returning value to shareholders could be a contributing factor to Horizon Kinetics' ongoing commitment to Texas Pacific Land Corp.
Investors seeking more in-depth analysis and additional insights can find them on InvestingPro, which includes a total of 15 InvestingPro Tips for Texas Pacific Land Corp at https://www.investing.com/pro/TPL. To access these valuable insights, consider using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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